Get ready for the ceremonial hard hats. The NFL has granted the 49ers $200 million in G-4 loan funds, the financial linchpin in the team’s Santa Clara stadium plan. That money, combined with the $800 million in loans put together by BofA, US Bank, and Goldman Sachs, should make it possible for the team and the city to move forward with a soft groundbreaking very soon. That would be followed by a modest demolition and clearing of the parking lot, which has little but asphalt and parking safety light poles running through it.
Not coincidentally, Santa Clara took a preemptive legal step and sued anti-stadium group Santa Clara Plays Fair to stop them from getting the stadium project on the ballot again. An unusual step, City Attorney Ren Nosky moved forward with this in order:
“to remove any uncertainty over this issue” and “establish once and for all” that the project can’t go back to the ballot.
It’s an interesting move, and probably a good one for all concerned. It puts SCPF on the defensive, because it’s likely that the city will have its legal argument at the ready and, depending on how quickly the lawsuit in Santa Clara Superior Court is heard and how much support SCPF gets from outside, the group may be ill-prepared. We’ll see if they get the requisite support from the ACLU, as advertised. Presumably Ralph Nader’s League of Fans should also be involved, though not from a legal funding standpoint.
The two sides will be arguing over the contents of the 400+75 page, two-part Disposition and Development Agreement (DDA). There’s a lot of stake, because if the court were to strike down parts or all of the DDA, the team’s financing could be at risk. SCPF wants a new referendum, so if a judge rules that the DDA were partially or wholly improper compared to the terms passed with the 2010 referendum, it’s a huge delay that could, via the vote, kill the project entirely. For Jed York, the reasoning is probably simpler – he wants to open the place in 2014. Even with the staggering cost of the venue, it’s all the more reason to get a jump on being able to service the stadium’s debt. I figure if the lawsuit were heard in the spring, the judgment could be wrapped up by summer at the very least. Meanwhile, the city would be concurrently clearing the land. The stadium would take 27-30 months to construct, so they could hit their target if absolutely everything went right. If they experience a delay because of the lawsuit and/or referendum, it’s pretty much a 2015 launch unless the team wants to split the 2014 season between Santa Clara and The ‘Stick. I may be a fly on the wall for some of the hearings.
Moving away from the legal realm, the terms of the NFL loan are curious in that they aren’t forcing the Raiders to share the stadium in Santa Clara. The league is asking to 49ers to keep the Raiders in mind. This is something of a pivot, since last year I had heard that if both Bay Area teams were to stay, one facility somewhere was the best possibility. I suppose this is in keeping with the Raiders’ and Mark Davis’s city-agnostic stance. The Raiders in play for both Santa Clara and Los Angeles, and I have to believe that the NFL likes that kind of flexibility. The more teams that could move to LA the better. San Diego is one. The Vikings can’t get anywhere in the Minnesota legislature. Buffalo will probably opt for small improvements to Ralph Wilson Stadium, for which the G-4 program has a subset of rules for financing. Under new ownership, Jacksonville is not in play for the time being. The St. Louis Rams appear to be at the greatest risk of leaving, with onerous lease terms for the city and the team’s long LA legacy. It could play out several ways:
- 49ers/Raiders in Santa Clara, Rams in LA
- 49ers in SC, Rams/Raiders in LA, Chargers in SD
- 49ers in SC, Raiders/Chargers in LA
- 49ers/Raiders in SC, Rams/Chargers in LA
What I don’t expect to happen is for the NFL to hand out three loans of $200 million to Santa Clara, Los Angeles, and San Diego (or SC, Oakland, SD). For this CBA cycle and the number of teams that need new venues, the NFL is probably working with a $1 billion cap on G-4 loans, with some allowance for improvements to older venues. The previous CBA, which ran six years, had only three venues built during the period (Cowboys Stadium, MetLife Stadium, Lucas Oil Field) and one that opened just as the CBA period started (U. of Phoenix Stadium). The G-3 loan program then ran out of money in early 2007, which should be a signal to all teams that are looking for the NFL to pony up: he who hesitates is lost.